How Endicott -Johnson Lost Its Sole: The P.J. Casella Story

How Endicott Johnson Lost Its Sole: The P.J. Casella Story
By John Solak

Broome County didn’t just lose a company when Endicott Johnson crumbled. We lost the soul of the Triple Cities — the factories that built Endicott, Johnson City, and Binghamton; the Square Deal that put shoes on working feet and roofs over families’ heads; the welfare capitalism that George F. Johnson turned into a legend. And if you want to know why Broome looks the way it does today — hollowed-out downtowns, lost jobs, and a lingering bitterness about outsiders who came, took, and left — start with the man who kicked the first big hole in the dam: P.J. Casella.

Casella came to Endicott in May 1961 from Genesco, the big Southern shoe conglomerate, as senior vice president of sales and marketing. EJ was already bleeding — a $1.5 million loss in 1960, the first red ink in company history. A New York City holding company was circling for a proxy fight. The community rallied, the raider backed off, but the damage was done. Management needed fresh blood. They got Casella.

By October 1961 he was president. Frank A. Johnson stepped up to chairman, and the board handed Casella the keys to the kingdom. What happened next? More red ink. A lot more. In 1961 EJ lost over $12 million. Sales kept sliding. The “sales and marketing expert” couldn’t stop the hemorrhage. By mid-1963 the board had seen enough. They booted Casella upstairs (or out the door, depending on who you ask) and brought in a real shoe man: Eli G. White.

White knew the business from the factory floor up. He’d been recruited earlier from General Shoe. In July 1963 the board made him president and chief executive officer and told him to fix the mess. He cut costs, restructured, tried to steady the ship. But here’s the brutal truth: the hole Casella helped dig was already too deep. Even Eli White — the shoe man himself — couldn’t dig EJ out of it. The company was heading toward its lowest sales level in 17 years. Operating losses piled up. The magic was gone.

Casella didn’t stick around to watch the funeral. By 1964 he was gone — off to run Elgin National Watch Co. in Illinois. He resigned as EJ president about a year earlier and cashed out part of his stock on the way out the door. Nice work if you can get it: parachute into a historic local giant at its moment of weakness, rack up historic losses, then bail for another corner office while the workers and the towns are left holding the bag.

One particularly bitter footnote from the Casella era: under his watch as the sales and marketing “expert,” EJ began sourcing shoes from overseas production — including having EJ-branded footwear made in Czechoslovakia (then part of the Soviet bloc). At a time when the company’s own factories in the Triple Cities were struggling and local workers were watching their livelihoods erode, the push toward foreign manufacturing only accelerated the disconnect from the hometown labor force that had built the brand.

That’s what set the stage for Bernard P. McDonough.

Enter the West Virginia industrialist in the late 1960s. McDonough started buying EJ stock aggressively. By early 1969 he was chairman, criticizing the “extravagant waste” of the previous management (that would include the Casella era). He talked about turning things around, but the McDonough Company playbook was clear: acquire, strip the profitable pieces, and move on. EJ’s footwear operations became just another line item in a diversified holding company. The raider from Parkersburg didn’t build here. He picked the bones.

Add this to the indictment: In 1960, as Endicott Johnson teetered on its first loss, the Endicott Johnson pension fund sat there with real money in it — assets in the tens of millions, including substantial stock holdings built up over decades under the old Square Deal. Back then, before ERISA in 1974 tightened the rules, you could legally rob a pension fund blind if you had control of the board and the right lawyers. Overfund it with company stock when times were good, then use it as a piggy bank or collateral when the outsiders rolled in. It wasn’t called looting yet. It was just “modern management.”

During the 1961 proxy fight, the pension fund bought 80,000 shares at $31.50 each — over $2.5 million in one bite — to help fend off the raider. Old-timers in Broome County recall the fund’s assets hovering around the $28 million range in that era (for a company that once employed 20,000). Whether exactly 28 million or close, the point holds: there was real worker money parked there, tied to EJ stock and company promises of security in old age.

When outsiders like Casella and later McDonough took the wheel, that fund became convenient. McDonough openly criticized the “extravagant waste” of prior regimes. By the time he took the chairman’s seat in 1969, he had bought more shares than were held by the pension fund and insiders combined. The fund’s holdings were diluted, redirected, or used as leverage in the restructuring games that followed. Tanneries closed in 1968. The medical department shut in 1969. Factories started the long bleed. The Square Deal — George F. Johnson’s promise of steady work, benefits, and dignity — got carved up.

Pre-ERISA rules made it easier. Companies could terminate overfunded plans, recapture “excess” assets, and walk away with the surplus while workers got whatever the minimum formulas allowed. Plenty of old EJ families still swear that’s exactly what happened here: the pension was milked or mismanaged while the new regime focused on “efficiency” and stripping what was left.

Casella didn’t personally empty the vault. He set the stage — massive losses, loss of local control, introduction of big-corporate thinking (including early overseas sourcing) that treated the Triple Cities like just another division on a balance sheet. Eli White couldn’t dig out because the foundation was already cracked. Then McDonough arrived with his holding-company model.

There were fleeting bright spots, or at least attempts at them. In the late 1960s, around the time McDonough was consolidating power, EJ still landed some military work — producing jungle boots for the Vietnam War effort. Those boots, stamped with the EJ name, went to American troops in Southeast Asia in 1968-1969 and beyond. It was a partial comeback to the glory days when EJ supplied vast quantities of footwear for World War I and II. But it wasn’t enough to reverse the decline. The company that once churned out millions of pairs a year was now scrambling for contracts while its core civilian business eroded.

Meanwhile, EJ tried to pivot toward retail. In 1965, under the post-Casella reorganization, the company acquired the Nobil Shoes retail chain — a solid, progressive family-type operation with stores known for their strong locations and growth potential. These were prime retail spots in high-traffic areas, the kind of “retail locations to die for” that any shoe company would envy. Yet as the manufacturing side weakened, those assets didn’t save the hometown operations. The retail division was eventually folded into broader corporate maneuvers, with pieces and concepts feeding into the larger shoe retail landscape that Woolworth (through its acquisition of the Kinney Shoe chain in 1963) was building. Kinney’s stores and formats would later evolve into Foot Locker, the athletic retail giant whose roots trace back to that Woolworth-era consolidation. EJ’s own retail push couldn’t stem the tide of imports and internal mismanagement.

By the 1970s and 1980s the writing was on the wall. Factories closed. The Square Deal evaporated. EJ was sold a few times in the years that followed, passing through successive corporate owners as the once-proud local giant became just another asset in distant portfolios. Under the McDonough era and subsequent owners — including a period when EJ fell under the umbrella of Hanson PLC (the British conglomerate known for aggressive acquisitions and asset optimization) — the company kept shrinking. The last major EJ manufacturing facility in the Triple Cities area shut down in the 1990s, with the final echoes of local production fading by the late ’90s. In 1995 it was purchased by U.S. Industries and operations largely moved out of state, eventually becoming part of Rocky Brands.

Yet here’s the small miracle that somehow kept a flicker of the old EJ alive for years after the factories went dark: remnants of the company continued operating quietly out of modest office space in Vestal. A skeleton crew handled licensing, branding, or residual business affairs long after the brick-and-mortar production heart of Endicott and Johnson City had stopped beating. It was a ghostly persistence — shoe company without the shoes, or at least without the local shoes — that spoke to how deeply the name and the legacy were embedded, even as the real economic engine was gone.

This is about accountability. P.J. Casella wasn’t some cartoon villain. He was a symptom of something worse: the creeping belief that local companies needed “professional” outsiders with big-company résumés to survive. They brought in the numbers guys, the marketing hotshots, the efficiency experts. They lost the connection to the factory floor, to the workers who actually made the shoes, and to the communities that depended on them.

Eli White — the last true shoe man at the helm — gave it everything he had. He couldn’t overcome what Casella’s tenure had already set in motion. And when McDonough arrived, followed by the asset-stripping logic of later owners like Hanson PLC, the stage was perfectly lit for the final act. In a telling postscript for that shoe town, Eli White left the industry entirely; in 1975 he became the manager of the Hyatt Regency in Nashville — quite a watershed event as the expertise that once powered a proud manufacturing empire found new life in the hospitality business far from the Triple Cities.

P.J. Casella had deep ties to the Binghamton region. After leaving EJ and his stint at Elgin National Watch, he returned to the area, living locally and engaging in management consulting and real estate activities. Later, the P.J. & Palmina Casella Foundation operated out of Vestal, supporting local causes including scholarships at Binghamton Community College. Someone familiar with the valley still helped crack the foundation.

And here’s the final irony that twists the knife for anyone who grew up in the Triple Cities: Binghamton boy Ed Stack — East Side kid whose father started a tiny bait-and-tackle shop on Court Street in 1948 — built Dick’s Sporting Goods from those humble roots into a national powerhouse. Then, in 2025, Dick’s under Stack’s leadership acquired Foot Locker in a major deal. The very retail lineage that swallowed up EJ’s promising Nobil stores and Kinney/Woolworth athletic formats? Now it’s being run by a hometown guy who made it big in sporting goods.

Stack, the Binghamton native who worked the family store as a teen, ends up overseeing the modern descendant of the retail assets that couldn’t save Endicott Johnson’s manufacturing soul. The factories that once made the shoes are long gone, the pension promises eroded, the Square Deal broken. Yet the retail side lives on — merged, consolidated, and now circling back under a Broome County name.

Broome County paid the price. We still are.

Next time you drive past those empty red-brick hulks along the Triple Cities streets, or walk into a modern Foot Locker (now under Dick’s) in a mall somewhere, remember the name. P.J. Casella didn’t swing the wrecking ball himself. He just made sure the foundation was cracked enough that someone else could finish the job — pension fund and all — while fleeting military contracts, promising retail assets, early overseas sourcing in places like Czechoslovakia, and later corporate owners like Hanson PLC slipped through the cracks.

That’s why Broome is still digging out decades later. The irony? Even the comeback kid from Binghamton couldn’t bring the shoe factories back. He just bought the store.